Hundreds of fresh redundancies have been threatened as the Prime Minister hosted a jobs summit and pledged that people thrown out of work would not be "abandoned" by the Government.
Gordon Brown announced a series of measures aimed at holding back the tide of job cuts in British industry, including a so-called "golden hello" of £2,500 for firms recruiting people unemployed for more than six months.
More apprenticeships will be offered as well as "intensive" support to the growing ranks of unemployed, such as work-focused interviews and help to upgrade skills.
He told an audience of 150 business, union and voluntary sector leaders at the summit held at the Science Museum in London: "We estimate that with this additional financial support we will be able to help 500,000 people into work or work-focused training over the next two years."
The Government said it will invest £500 million over the next two years, mainly for workers who have been out of the job market for at least six months.
Everyone out of work for this period will be offered a more personalised package of support, including training places and opportunities to do volunteering work.
They will also be given advice on how to set up their own business.
Mr Brown said anyone losing their job will be able to access help and support on the first day.
"We estimate that with this guarantee of extra financial support, we will be able to help 500,000 people into work or work-focused training over the next two years. I believe we can help families through the downturn and secure our future competitiveness in a global economy.
"We are determined that Britain can lead the world to help the unemployed and create the jobs of the future. I believe we can do this by working in partnership. Britain works best when we work together."
